tv The Journal Editorial Report FOX News November 13, 2010 11:00pm-11:30pm EST
this week on the "journal editorial report "a showdown looms and republicans prepare to make their mark on fiscal policy. is the president ready to retreat on taxes? and with states facing their own budget short fall, texas governor rick perry tells us how he'll close the gap without washington's help. plus, the bush legacy from the financial crisis to
his freedom agenda. does the former commander in chief have regrets? he tells our own jim strossel.
welcome to the journal editorial report. i'm paul gigot. lawmakers return to washington for a post-election lame duck session, issue extending bush-era tax cuts will be at the top of the agenda. the white house signaled president obama may be ready to cut a deal, accepting a temporary extension of the cuts to win renewal of a tax break for the middle class. david axlrod is denying this is a retreat. why are liberals howling? joining the panel this week, dan henninger, james freeman, and washington columnist kim strossel. what a difference an
election makes. axlrod getting pounded for dealing with the obvious. a are the tax cuts going to be extended? how long? >> before getting to whether
they will be, let's describe what will happen if they did. if they extended tax cuts for three years it would be the biggest economic booster we've seen. cash would be unlocked in corporations and stock market goes up. what are the chances? do you know what? i'd say about 25%. >> 25? >> yes. >> and that is my -- . >> three years? >> right. >> wow. >> you might not get real. >> i put them higher than that. >> and allow me to get... i think this is a trap, paul. i do. i do not think that the administration or the democrats are going to deal in good faith. i think the game is just what it was before the election. paint the republicans as party of obstruction and tee up john boehner as republican pelosi this, is not the real john boehner. make him pop and put him in opposition with the smooth, cool president obama. >> that means all tax cuts
would expire. because presumably republicans aren't going to go along with only a partial extension. do you see that train-wreck scenario? >> i do think there are a lot of congressional kem kems -- democrat who's are not thrilled to play ball, original intention was to try to jam the republican was some legislation that they'd not be happy with, either one idea is to permanently extend middle class tax cuts but only temporarily extend higher rates. >> right. but i don't see republicans agreeing to that kind. i think republicans say let's get them together and move ahead, one together, or -- or we'll let them expire. >> yes. coming up, this election, they've got a lot more strength and know there is a lot of democrats who are very nervous about this issue. right now, and are probably going to see wisdom of simply extending them all at least
for some temporary period of time. it's the smartest way they can go. >> we have a fight among republicans, kim, over earmarks. this is the special pork projects members put into bills. and the house is already said they want a moratorium. the senate is resisting. who has got the better argument? >> they went a week without having a fight with themselves. you know? well, the problem here is that you've got guys, senate minority leader mcconnell, some of the guys, they -- . >> he's the oklahoma senator, imhof is he has a lot of play over the highway bills with which tends to have a lot of earmarks in it. the guys are saying we don't want to give them up. and now, you have these new reformers coming in who just won election and the senator offered this moratorium, that would be only binding on rinz.
or, i should say nonbinding on republican buzz going forward, and now they've got to fight they're going to have a vote on it this next week. it will be a terrible message. >> who do you think is going to win in the senate? >> now, it's equal. they're split on the votes. goitsing to be a landslide one way or another. someone is going break that, either going with mr. mcconnell or you'll probably see a bigger side on that sitd. >> i think it's symbolish politics change here are significant. the first thing republicans say is earmarks as usual it's going to sour people out there on this new -- the recent election. >> yes. tim pointed out, it's one thing they can control. they can say we're not going do this anymore. so maybe we should be optimistic about that. i'm more optimistic about tax cuts getting extended. take a look at the -- . >> three to one against
henninger on that. >> yes. >> senate democrats in moderit swing states up in 2012, huge incentive not to have a tax increase, liberals are howling but this is a fight over are you going to win the status quo? >> right. and the president does want to win reelection. he does want the economy to be good between now and then. i think some of his advisors wonder if if you don't extend those cuts goitsing to hurt the economy. >> i am sorry. i believe that the oral office is bloody minded the same way nancy pelosi insists on being minority speaker. i'm afraid the white house is marching to the same drum. >> after one term. okay. if you think the federal government has got money problems wait until you get a load of the state. when we come back, texas governor rick perry tells us how he plans to close a $20 kbrinl budget gap without
washington's help. why he disagree was gorge bush's compassionate conservatism z why, if he has his way, trial lawyers could be soon fleeing the lone star state. ♪ [ female announcer ] if you get caught by surprise, always leakguard protection adjusts to sudden changes in flow. no other ultra absorbs faster. o relax, we got you covered. have a happy period. always.
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as a showdown over taxes and spending looms in washington governors in 39 states are facing big short falls of their own. in texas where voters reelected governor perry last week, the projected gap could exceed $20 billion. i sat down with governor perry earlier to talk about his new book "fed up. our fight to save america from washington". i asked what one thing john boehner and a republican congress could do. >> stay out of our business would be one thing. >> just that? >> that would, but, from a more global standpoint, if you will, allowing these job
creators to have some certainty in the tax structure, nobody knows what the capital gains tax is going to be next year. they don't know how they're going to be impacted. that is the single most important, i think information that job creators and people that goring to risk their capital need to have now. >> so hold out for keeping current tax rates and dividends, capital gains and income. where they are. one year? two years? >> or permanent? >> permanent would be better. but i don't if you can get permanent with this administration. get what you can get out of the administration. try as much as you can. i suppose they want to run for a second term. we'll find out. >> okay. you just won a fourth term as governor. your award looks like goitsing to be a did he have it and people are estimating $20 kbrinl for a two-year cycle. >> right. let me clear up one thing. we don't have budget deficits
in texas there. is a projected short fall that maybe, we don't know yet. we've been creating jobs, and reported that our tax revenues have been up between 6% and 8% per month for eight months. >> it's better than most states. >> it s the fact is that we're probably going to have some type of short fall. >> and we treat it no differently. the revenues slow up. we prioritize what is important that. is going to be keeping the economy going. and security. safety. for our citizens and educational opportunities for their children. those are the things people care about. fund those, we'll reduce spending. we did it in 2003. >> last time you had i think a $15 kbrinl short fall. something like that. you had help from the federal stim list. so arguments you had that. money did help cover that short fall. >> in 2003. there was a $10 billion budget
short fall. we addressed that and reduced our spending and billed that gap without raising taxes. we're going to do the same thing this time. >> you're saying no tax increase? >> absolutely not. >> you don't need neither federal stimulus dollar. >> we've turned back stimulus dollars through race to the top. they tried to black mail us with unemployment insurance money which was our dollars to begin w they had strings attached. >> we'll take the dollars from washington, my hope is that we can come up with ways where we don't send so many dollars out to washington, d.c.,. >> there is a big victory in the legislature, pretty close to almost a veto-proof majority in the house. there is no excuse for republicans not getting what you want. it's done if you're legislature, what are the two, three main priorities? >> we work together. it's not just what i want. we work with the lieutenant
governor and speaker. but keeping the texas tax burden light, the regulatory climate predictible and fair, we may expand, you know we've had sweeping tort reform in the nation. paying great dividends. >> hands down. >> tort reform may be on the agenda. and to the tune of loser pay. loser pay may be one of those... >> someone, if you sue, but lose the case, you may the cost costs of the defense. >> right that. is the british system. >> we think that will clear up a lot of the oversuing and still... we see in texas. the frivolous lawsuits. the shotgun approach, if you will. and i can assure you, we're going to have a good discussion on it and i don't think i'd want to be a republican member of the legislature that voted against lose or pay with the powerful message sent on tuesday. >> i notice that had another
texan has a book out. president george w. bush. same time, you're both selling books about the same time n your book you criticize the former president for his compassionate knit conservative team. explain that. >> i think gorge -- george bush will go down as one of the great presidents in history. his fight against islamic terrorists in the west is some of the important work of the 20th and 21st century, to date. there are issues dealing with the budget i disagreed with. the fact of the matter is that republicans in control of congress in the mid 2000s spent too much money on programs, whether medicaid part d or no child left behind, programs cost too much money. >> sold in the name of compassionate conservatism. >> yes. i will tell you, i think those were wrong. we have a chance now as we go
back into session, in january, to redo a lot of those. i think the american citizens sent a clear message. we don't want you spending all of the dollars on the plam plams -- programs we don't necessarily want. >> what should snb. >> i don't. you know... >> fiscal conservative. >> i talked about fiscal conservative and -- small government. people get that. i mean, the tea parties were spot on. they focused in on the spending. >> right. >> that is what they cared about. there is every kind of person in the world there. the fact is that people want to see small government, and fiscal conservatism at play. >> all right. governor, thank you for being here. >> you're welcome, paul. >> thank you. >> you just heard governor perry's criticism of george bush's compassionate conservatism. does the former president have regrets of his own? kim strassel recently sat down
with him. she'll tell us about it. and our panel weigh ndz on the bush legacy, right after the break. on our car insurance. great! at progressive, you can compare rates side by side, so you get the same coverage, often for less. [ disco playing ] and this is to remind you that you could save hundreds! yeah, that'll certainly stick with me. we'll take it.
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you just heard texas governor rick perry's critique of george bush's domestic policies. in his memoir out this week, and in an interview, the former president defends his record on the economy and spending and he also makes the case for his freedom agenda so, kim, you sat down with the former president. was there anything that surprised you about the interview? >> yeah. i twont his house a couple weeks ago in dallas. i don't know why we'd call it surprising but the notable part of the interview is that this is a guy not wringing his hands over what history's
judgment of his presidency is going to be this, is a controversial president. the left dismices him for wars and tax cuts. and the right was unhappy with him over prescription drug program, over no child left behind. some people believe he laid the ground work for president obama. when you talk to him, he spoke of some regrets and mistakes but on big issues he seemed to be comfortable and confident. history would see knit a favorable light. >> james, in the governor perry versus president bush debate over spending and the bush record, who do you think gets the better of the argument? >> well, governor perry f you're talking about spending, i should say i think bush had some -- president bush had notable achievements, 2003 tax cuts. two great additions to the supreme court. and he started internet tax moratorium. on spending have you to say he dropped the ball there.
as someone working on the hill at that time, he had republicans on the hill to work with him, they -- nondefense, nonhomeland security spending was rising rapidly. and you saw what happened. he took as a share of gdp from roughly 18% of almost 21%. >> right. >> just refused until... i guess, six years into the term to veto. >> yes. and what republicans would send him in terms of spending. >> the classic spending is are you going pay for guns or butter? he just said "yes". people wanted vetoes but i think he started saying that in his last year, you look at bear sterns and at the end of the year you're bailing out general motors this is an extreme interventional economy setting the table for barack obama's stimulus. >> when fed chairman and treasury secretary come to the president and say look, the economy is going over.
you've got to do something, most president, i'd argue every president is going to do what bush did, at least in the case of lehman brothers. he's going to go with that instinct. because your an information taker. >> when you would, i would like a more skeptical president. you look at quotes, he doesn't seem to have pushed back on the idea. >> i agree. it's notable. >> let me try tochl plain why he wasn't a more skeptical presidency. this was the september 11th presidency. september 11th was an experience all of us had. he experienced it in a unique way as president. he went and saw the pentagon. he went to ground zero and saw that. and the country was in a huge crisis what. george bush concluded is that he must convey resolve and confidence. because american people were thrown back. show no doubt on anything he's doing. and he pull that had all the way throughout his presidency. i think it affected his
policies on iraq and as a crisis at the end of the presidency, he called the second biggest crisis. there should have been more reflection when iraq was going bad. he should have changed a general sooner. he could have had more internal debate on the financial crisis. but that is not the kind of persona he's going to convey. >> i would say james he really got caught by surprise. by what happened. and in the financial crisis. and in the book, none of this, nothing comes through there was doubt when the housing market was going up, when the credit bubble was forming there is no real sense maybe this was something that was going to go bad. >> he was put in a tough situation. he did try to reform fannie and fr eddie. there was a moment secretary -- paulson decided not to push that very hard. bush signed off on it. i do think on spending side, while the record is bad for president bush, we ought to give him credit he did try to
reform that entitlement monster known as social security the republican and house got weak knees on that. he deserves credit for taking that one. >> democrats were across the board. >> yes. forget them as far as reform. >> do you think the president's legacy in iraq and afghanistan depend on how the wars turn out? >> i think it's wholly linked. this is a war presidency f that succeeds, his presidency will succeed. >> we have to take one more break. when we come back, hits and misses of the week. ♪ ♪
>> time now f time now for hits and misses of the week. >> a hit to new york city outgoing school chancellor, joel klein. people viewed him as a standard reformer who would nibble around the edges. he saw dysfunction and made attempts to shut down failing schools and grade them, expose bad practices and inproduce
concepts like merit pay. these days in the area of school reform, it's best evidence you're doing your job. >> james? >> former ska governor sara palin and president elect of brazil, two women telling federal reserve chairman this week he's going to stop printing money that, snot what we need and not going to fix our economic problems. who would have thought sara palin leading the world? a coalition of central bankers and leaders overseas to get the u.s. to reform it's monetary policy autos paul, a couple weeks ago a big miss to french students rioting over proposal to raise the retirement age there. this week, it's merry old england. they had a demonstration that your honor turned ugly. mobs started ran saking -- ransacking the building there. a